The High Court of Delhi held that the conditions imposed by Customs for the provisional release of imported roasted areca nuts were onerous and reduced the required security to a ₹4.10 crore bond and ₹50 lakh bank guarantee.

Shreehari Ananta Overseas Pvt.Ltd, petitioner-assessee, had obtained an Advance Ruling from CAAR, New Delhi, classifying Areca Nuts under Customs Tariff Heading 2008 19 20 as ‘Other roasted nuts & seeds’.

Based on this, it imported five containers of Areca Nuts from Indonesia through ICD Patparganj and filed three bills of entry, following the classification in the ruling.

The Customs Department sent the goods for testing to CRCL. While some samples were found fit for consumption, others were declared unfit, with the reports suggesting the goods were ‘dried areca nuts’.

The petitioner requested re-testing through a letter dated 14th November 2024. However, the re-test reports again showed the same inconsistencies as the original ones.

Due to delays in releasing consignments imported in September and October 2024, the petitioner approached the Delhi High Court through W.P. (C) 5024/2025, seeking provisional release of roasted areca nuts imported under three Bills of Entry. The petitioner had obtained an advance ruling classifying the goods under Custom Tariff Heading 2008 and submitted that FSSAI had cleared the goods. However, Customs sent the goods for further testing to CRCL, which gave inconsistent reports.

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The petitioner stated that the goods were intended for industrial use only and offered to submit an undertaking to that effect. On 22nd April 2025, the Court directed the Customs Department to consider provisional release based on this undertaking and to pass an order by 31st May 2025.

In compliance, the Joint Commissioner of Customs passed an order on 29th May 2025, allowing provisional release subject to a bond of ₹4.10 crore and a bank guarantee of ₹5.81 crore. The petitioner was also directed to submit an undertaking confirming industrial use and later provide an End Use Certificate.

The petitioner’s counsel argued that the conditions were excessive given the goods were worth only ₹1 crore. However, the Customs Department justified the conditions, stating the valuation was based on the minimum import price of around ₹4.10 crore.

Justice Prathiba M.Singh and Justice Rajneesh Kumar Gupta noted that the goods were released only for industrial use and found the conditions imposed by Customs to be excessive. The Department had asked for a bond of over ₹4.10 crore and a bank guarantee of more than ₹5.81 crore, which the Court held to be onerous even considering the Department’s own valuation.

The Court reduced the requirement and directed the petitioner to submit a bond of ₹4.10 crore and a bank guarantee of ₹50 lakh within two weeks. It clarified that the release would be subject to the ongoing investigation and any further directions from the authorities.

The petition and all pending applications were disposed of.

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